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Author: 5048 Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 1193  
Subject: Re: Must RRSP be reported by US Citizen? Date: 8/1/2007 3:38 PM
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Two comments:

(1) Canada only taxes income from Canadian sources (and all such income, regardless of your residence status). If your only Canadian-source income is from a tax-deferred plan, there are no Canadian tax issues. But if you withdraw money from that plan or have other Canadian-source income, tax will be withheld at the source and you have to file a Canadian return to get it back. The default withholding rate varies with the amount of income from 10% to 30% (if you claim US residence for tax purposes). By the way Canadian exemptions are generous, so you will get a refund.

(2) If as a US permanent resident or citizen you don't report RRSP earnings on From 8891, the IRS can charge you with tax evasion - i.e. intentionally understating your worldwide income. The fact that you would have paid no tax if you had filed Form 8891 doesn't matter, but your intent to hide income by not filing the form does. So unless you have a compelling reason not to, you should file Form 8891.
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